Former Labour MP Phil Woolas's hopes of regaining his seat have been dashed after he failed in a High Court bid to overturn a decision stripping him of his Commons seat.

Mr Woolas, who is banned from standing for election for three years, said there is no avenue open to him to mount a further challenge. The ex-minister said: "That is the end, I am out - which I think is unfair and, more importantly, my 70,000 voters will think it is unfair."

Three senior judges rejected his legal challenge against the November 5 decision of a specially convened election court declaring void the 2010 general election result in Oldham East and Saddleworth.

In the first judgment of its kind in 99 years, the election court ruled that Mr Woolas was guilty of deliberately lying about Liberal Democrat rival Elwyn Watkins. Later Mr Watkins welcomed the decision, declaring it "a victory for the people of Oldham and Saddleworth".

The election court judges had found comments made by Mr Woolas in election campaign statements clearly amounted to attacks on Mr Watkins's "personal character or conduct", in breach of Section 106 of the Representation of the People Act.

The former immigration minister had accused Mr Watkins of trying to "woo" the votes of Muslims who advocated violence, and refusing to condemn extremists who advocated violence against Mr Woolas himself.

Imposing the three-year ban, the election court held that Mr Woolas, who beat Mr Watkins by just 103 votes in a bitter campaign, had "no reasonable grounds for believing (the statements) to be true and did not believe them to be true". Mr Watkins's legal team had described Mr Woolas's election strategy as being "of the basest kind", stirring up racial tensions in an area that had seen race riots in 2001.

At the High Court, lawyers for Mr Woolas argued in a two-day hearing last month that the election court judges had misdirected themselves on the true meaning and effect of the words "personal character or conduct".

But Lord Justice Thomas, Mr Justice Tugendhat and Mrs Justice Nicola Davies, sitting in London, declared that Mr Woolas had rightly been found guilty of "illegal practice". The judges said statements made by Mr Woolas about Mr Watkins were "a serious personal attack on a candidate by saying he condoned violence by extremists and refused to condemn those who advocated violence."

Mr Watkins said: "This judgment makes it clear once again that if you knowingly lie in your election campaign and deceive your constituents you should be kicked out of Parliament... Now it is time to move on and for the by-election to take place. The people of Oldham East and Saddleworth have been without an MP for long enough."